Wall Street advances with broad gains, buoyed by tech stocks

NEW YORK - US stocks climbed to kick off the holiday-shortened week, buoyed partly by a continued rebound in technology stocks in a broad advance that lifted almost all of the 11 S&P 500 sectors.

The rally started late last week and was driven by Micron Technology’s blowout forecasts and a cooler-than-expected inflation report, which has left the S&P 500 and Dow less than 1 per cent from their record closing levels set on Dec 11.

Nvidia shares rose 1.2 per cent as the biggest lift to the benchmark S&P 500. Reuters reported the company has told Chinese clients it aims to start shipping its second-most powerful AI chips to China before the Lunar New Year holiday in mid-February.

Micron climbed 3.8 per cent, while most other chipmakers also advanced, with the Philadelphia SE Semiconductor Index up 1.1 per cent.

“I don’t necessarily think it’s going to go much higher; it’s going to continue to churn,” said Mr Ken Polcari, partner and chief market strategist at Slatestone Wealth in Jupiter, Florida.

“Today, we’re trading higher. But I wouldn’t be surprised if we back off again and then we just rally again right into about where we are.”

The Dow Jones Industrial Average rose 233.48 points, or 0.48 per cent, to 48,367.72, the S&P 500 gained 41.16 points, or 0.60 per cent, to 6,875.66 and the Nasdaq Composite gained 127.10 points, or 0.55 per cent, to 23,435.00.

December has historically been a strong period for stock markets. Since 1950, the Santa Claus rally has been reflected by the S&P 500 rising by an average of 1.3 per cent over the last five trading days of the year and the first two trading days in January, according to the Stock Trader’s Almanac.

This year, that period starts on Dec 23 and runs through Jan 5.

Optimism about AI, signs of a resilient US economy, and expectations for monetary policy easing have outweighed concerns about US tariffs, helping put the three main US indexes on course for their third consecutive year of gains. The S&P 500 is up more than 15 per cent this year.

Ten of the 11 S&P sectors traded higher, with materials and energy among the best performers as commodity prices jumped. The tech sector added 0.5 per cent.

Thin trading

Wall Street’s fear gauge, the CBOE volatility index, hit its lowest level since late August.

Trading volumes were light and were likely to thin out further as the holiday approaches. US stock markets will close at 1pm ET on Dec 23 and shut on Dec 24 for Christmas.

However, economic data, including the preliminary reading of third-quarter GDP, December consumer confidence data, and weekly jobless claims, are scheduled for release this week, offering insights about the health of the US economy as well as hints about the monetary policy path.

“Tomorrow’s GDP number is going to be the last real piece of economic data that anyone really cares about,” said Mr Polcari.

Among other movers, Tesla gained 2.5 per cent to an all-time high after CEO Elon Musk’s 2018 pay package was restored by the Delaware Supreme Court. Warner Bros Discovery rose 3.5 per cent after Oracle co-founder Larry Ellison agreed to provide a personal guarantee of US$40.4 billion of the equity financing for Paramount Skydance’s offer to acquire the company. Paramount’s shares rose 5 per cent.

Clearwater Analytics Holdings rallied 8.2 per cent after a group of private equity firms led by Permira and Warburg Pincus clinched a deal to acquire the investment and accounting software maker for about US$8.4 billion, including debt. REUTERS